Compound interest calculator
See how savings or investments grow when interest earns interest — compound growth — versus simple interest on the principal only. Enter starting balance, periodic contributions, annual rate, term, and compounding frequency. The results include final balance, total interest, and Rule of 72 doubling-time estimate (72 ÷ rate ≈ years to double).
Principal
Annual interest rate (%)
Years
Compounds per year
Result
Future value: 16470.09
Interest: 6470.09
How to calculate compound interest
1. Enter initial principal and optional recurring contribution (monthly/yearly).
2. Set annual interest rate and compounding periods per year (12 for monthly, 1 for annual).
3. Choose investment length in years.
4. Compare compound vs simple totals and note the Rule of 72 doubling estimate.
Compound interest examples
€10,000 at 6%, compounded monthly, 20 years
No further contributions: final ≈ €33,100; compound interest ≈ €23,100. Simple interest at 6% would yield only €22,000 total (€12k interest) — compounding adds ~€11,100 extra.
€200/month at 7%, 25 years
Starting from €0, contributing €200/month with monthly compounding → ≈ €162,000; interest earned ≈ €102,000. Time in market matters as much as rate.
Rule of 72
At 8% annual return, money doubles in roughly 72 ÷ 8 = 9 years. At 4%, roughly 18 years — halving the rate doubles the doubling time.
When to use this tool
• When you project retirement or education savings with regular contributions.
• When you explain compound vs simple interest in finance lessons.
• When you sanity-check how fees or lower APR affect long-term wealth.
When to choose something else
• When returns are volatile (stocks) — use Monte Carlo or historical range tools.
• When loans accrue interest — use the loan calculator for debt cost.
• When tax-advantaged accounts have withdrawal rules — model net after tax separately.
The exponential curve
Compound growth is exponential: early years look modest; later years explode relative to contributions. €500/month at 7% reaches ~€86k in 10 years but ~€610k in 30 — most wealth arrives in the final decade. Starting early beats contributing more later because each euro has longer to compound. Even small rate differences matter: 6% vs 7% over 30 years on €100k principal is roughly €574k vs €761k.
Rule of 72 and planning
Use 72 for quick doubling estimates when teaching or pitching savings goals. For tripling, some use Rule of 114 (114 ÷ rate). Remember it assumes constant returns — real markets fluctuate. Pair compound projections with conservative rates for safer planning (e.g. 4–5% for balanced portfolios) and treat higher figures as upside scenarios.
Frequently asked questions
What is compound interest?
Interest calculated on principal plus previously accumulated interest. Each period, the balance grows faster than with simple interest.
What is the Rule of 72?
A mental math shortcut: years to double ≈ 72 ÷ annual rate (%). At 6%, about 12 years. It is an approximation, accurate for moderate rates.
How does compounding frequency matter?
More frequent compounding (daily vs annually) slightly increases effective yield. At 6% nominal, monthly compounding beats annual by a small margin over long terms.
Compound vs simple — when does simple apply?
Some short-term bonds or promotional products use simple interest. Most savings accounts and investments compound.
Does this account for inflation?
No. Subtract expected inflation mentally from the rate for real purchasing power (e.g. 7% return − 2% inflation ≈ 5% real).
Is my data sent to a server?
No.
Is this tool free?
Yes.